Shares in Smurfit Kappa (LON:SKG) have advanced in London this morning as the company said that it had completed the acquisition of Reparenco, a paper and recycling business in the Netherlands, for €460 million. The blue-chip producer of paper-based packaging argues that the Dutch company is a strong strategic fit with its existing European businesses.
As of 09:47 BST, Smurfit Kappa’s share price had added 1.25 percent to 3,088.00p, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.37 percent higher at 7,575.64 points. The group’s shares have added more than 28 percent to their value over the past year, as compared with about a 2.6-percent rise in the Footsie.
Smurfit Kappa wraps up Reparenco deal
Smurfit Kappa announced in a statement today that it had wrapped up the acquisition of Reparenco, which operates a two machine paper mill in the Netherlands, for €460 million. The FTSE 100 group said that the Dutch company’s strong strategic fit with its existing European businesses is expected to deliver synergies of in excess of €30 million.
“There is a strong cultural fit between our businesses and we are excited about the potential for Reparenco within the Smurfit Kappa integrated system,” Smurfit Kappa’s chief executive Saverio Mayer commented in the statement.
Today’s news comes after Memphis-based International Paper Company recently decided to end its pursuit of the FTSE 100 company.
Analysts on blue-chip group
Jefferies, which sees Smurfit Kappa as a ‘buy,’ lifted its price target on the shares from 2,930p to 6.460p last month. According to MarketBeat, the packaging group currently has a consensus ‘buy’ rating and an average price target of 3,182p.
Smurfit Kappa is scheduled to update investors on its interim performance on August 1.